Irene, Lee and the Jersey economy

If New Jersey’s economy sputters along, dragging down state tax collections along with it, Hurricane Irene and Tropical Storm Lee are probably going to get the blame, whether they deserve it or not.

That Irene and Lee are in the rhetorical cross-hairs has been made clear by the comments the state’s chief economist, Charles Steindel, attached to a pair of reports released over the last week by the state government — last week’s notice that tax collections are trailing forecasts, and today’s notice that the state’s economy lost jobs for the second straight month.

New Jersey recorded a drop of 11,100 jobs in September, though its unemployment rate fell to 9.2 percent. Nationally, 103,000 jobs were added last month, and the unemployment rate remained 9.1 percent.

“While this second consecutive monthly drop in the unemployment rate is good news, the weakness in payroll employment figures is disappointing. The effects of Hurricane Irene and Tropical Storm Lee may have held down our job count in September but, even so, the figures suggest that we have not been immune to the recent softness in national job formation,” Steindel said.

Private-sector jobs in New Jersey have dipped two straight months, falling by 13,600 since their recent July peak. They’re up 23,900 in the past year and 35,600 since Gov. Chris Christie took office in January 2010.

The number of government jobs, all levels combined, fell by 5,300 during September after rising by the same amount in August. There are 28,100 fewer public workers in New Jersey now than when Christie took office, meaning that overall there are 7,500 more jobs (private and public) in the state than the month Christie took over.

In the case of the tax revenues, the hurricane’s impact may be just a delay in revenues, not a loss. September filing deadlines were pushed into October, by the federal and state governments, to cut a break to taxpayers bailing out homes and businesses early last month.

So while September was 7 percent off the pace, state officials encouraged a wait-and-see attitude until October collections are tallied. “Those figures will also give us a clearer indication of the overall impact Hurricane Irene has had on New Jersey’s economy,” Steindel said.

But it’s unclear if that blame will be warranted. Steindel himself said in a separate report released this month that the storms probably would not affect the “overarching trajectory” of New Jersey’s economy.

“It’s natural to think these storms had a major effect on the state’s economy — we’ll all be talking about them for years to come, so surely they will have an impact on the pocketbook. However, it’s most likely the effect on the state as whole (not of course, on those who lost their homes) will be minor.

“This conclusion may seem startling, in light of estimates that put the insured damage the state has suffered is in the area of $2 billion. Unfortunately, the dollar total of physical damage is a highly misleading gauge of the cost of the storms and floods to the state’s economy.

“The more important effect is how these events will weigh on state employment, production and incomes. Based on many such events in the past, in New Jersey and elsewhere, the impacts are likely to be fairly small and short-lived. …

“Sales and production are also likely to be little affected. Purchases and output that were postponed during the storms can be quickly made up. There’s often speculation that rebuilding after a storm could provide a major impetus to activity, but evidence for that — except after a mega-event like Hurricane Katrina — is scant.”

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About Michael Symons

Michael Symons has covered seven governors while working in Gannett's Statehouse Bureau -- a stint which actually only stretches back to 2000, but the door revolves quickly in New Jersey politics. He's co-author of the biography "Chris Christie: The Inside Story of His Rise to Power."

Most contractors I know say Irene & Lee were god sends . In a alot of cases it’s the 1st time they worked in months , certainly the 1st time they added people to complete work . As far as the government payroll going down , they just retired .5000 to 7000 less government workers has meant nothing to me . Besides there not gone , they are just doing slightly less work then before & still getting paid for it.

When all that new office space opens up in Lower Manhattan , they are going to need to fill it & it’s the Jersey City/Newport area that will suffer the most . Alot of Long Islanders & NY residents can’t wait to go back to the Wall street area .

About this Blog

A second look at news, and not-quite-news, on New Jersey, its politics and government, from the Statehouse Bureau of New Jersey Press Media.

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During the past month, Gov. Chris Christie has been to several states for fundraisers and he is now in Mexico on a trade mission. Do you approve of all these travels?

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About the Authors

Bob JordanBob Jordan has covered state, county and muncipal governments for the past 10 years. He has also covered the gaming industry and has been a sports team beat writer for NHL, NBA and major league baseball teams.E-mail Bob

John SchoonejongenJohn Schoonejongen is state editor for Gannett New Jersey newspapers. He has reported and edited at New Jersey newspapers from Salem County to Passaic County, writing about everything from state politics to lost pigs on the Delaware Memorial Bridge. Born in Camden County, he still speaks with a southern New Jersey accent, much to his wife's annoyance.E-mail John

Michael SymonsMichael Symons has covered seven governors while working in Gannett's Statehouse Bureau -- a stint which actually only stretches back to 2000, but the door revolves quickly in New Jersey politics. He's co-author of the biography "Chris Christie: The Inside Story of His Rise to Power."E-mail Michael